15 Best Stocks For Long Term Growth

In this piece, we will look at the 15 best stocks for long-term growth. If you want to skip our introduction to the current drivers of stock market performance, then check out 5 Best Stocks For Long Term Growth.

The stock market in 2024 is characterized by a notably optimistic and forward-looking sentiment compared to the beginning of the previous year. Not only did the U.S. economy avoid tipping into recession, but stock markets also maintained their stability, defying expectations of a significant downturn. In fact, February 2024 witnessed the flagship S&P 500 index achieve a historic milestone by crossing the 5,000-point mark for the first time. This feat underscores the resilience and buoyancy of the stock market, highlighting investor confidence in the economic outlook. Additionally, the NASDAQ Composite, which is heavily influenced by the technology sector, approached its all-time high levels during the same period, further accentuating the positive sentiment in the market, albeit experiencing a slight pullback after the breakout.

The mention of “AI” among S&P 500 companies increased to 36% from 31% in the third quarter, with the information technology sector retaining its position as the sector with the most companies discussing AI. However, the energy sector experienced the largest increase in companies discussing this technology, as highlighted by David Kostin and his team of strategists at Goldman Sachs. In addition, NVIDIA Corporation (NASDAQ:NVDA), the blockbuster chipmaker prominently associated with AI, has witnessed remarkable growth, with its shares surging nearly 50% in the year, following a more than tripling in value in 2023. This surge has propelled NVIDIA Corporation (NASDAQ:NVDA) to become the third-largest U.S. company by market value, surpassing giants like Amazon.com, Inc. (NASDAQ:AMZN) and Alphabet Inc. (NASDAQ:GOOG).

When it comes to stock selection, targeting growth stocks is a common strategy for long-term investors seeking substantial returns. These stocks typically command higher share prices relative to their earnings per share, as they are expected to experience significant growth in the future. One key metric used to identify growth stocks is the price-to-earnings (P/E) ratio, which compares the current share price to the company’s earnings per share. A high P/E ratio, especially compared to industry benchmarks, suggests that investors are optimistic about the company’s growth potential and are willing to pay a premium for its stock. This optimism is based on the expectation that the company will deliver strong earnings growth in the future, thereby justifying the higher price paid today.

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Taking a long-term perspective on investment opportunities, growth stocks, particularly within the technology sector, showcase promising prospects. Among the noteworthy companies featured in our selection of the best stocks for long-term growth are Salesforce, Inc. (NYSE:CRM), MercadoLibre, Inc. (NASDAQ:MELI), and industry giants like NVIDIA Corporation (NASDAQ:NVDA), Uber Technologies, Inc. (NYSE:UBER), and Advanced Micro Devices, Inc. (NASDAQ:AMD), among others.

A large stock market board displaying the S&P 500 and S&P 500 Growth Index.

Our Methodology

For the following list of the best long-term growth stocks to invest in, we compiled a list of stocks that recorded a P/E ratio greater than 50. The list of companies was narrowed down further based on the number of hedge funds holding stakes in them according to Insider Monkey’s hedge fund data for the fourth quarter of 2023. The stocks are ranked based on this metric, from the lowest to the highest number of hedge funds holding stakes in them.

Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here). That’s why we pay very close attention to this often-ignored indicator.

15. The Trade Desk, Inc. (NASDAQ:TTD)

Number of Hedge Fund Holders: 41

P/E Ratio: 248.55

The Trade Desk, Inc. (NASDAQ:TTD) is a multinational technology company based in the United States, specializing in real-time programmatic marketing automation technologies, products, and services. The company focuses on delivering personalized digital content while advocating for Unified ID 2.0 (UID2), a protocol aimed at balancing relevant advertising with user privacy.

Following the release of strong first-quarter guidance and revenue beat, shares of The Trade Desk, Inc. (NASDAQ:TTD) surged over 18%. The company reported a 23% increase in fourth-quarter sales, rising from $491 million to $97 million year-over-year. Additionally, net income saw a 37% rise, reaching $97 million compared to $71 million in the corresponding quarter the previous year.

During last year’s December quarter, 41 out of the 933 hedge funds profiled by Insider Monkey were the firm’s shareholders. The Trade Desk, Inc. (NASDAQ:TTD)’s biggest investor is…